US aid freeze designed to further punish Palestinians

Michelle Gyeney

October 11, 2011

Amid the drama of the Palestinian statehood bid, the United States Congress has voted to freeze up to $200 million in aid that USAID, the State Department’s international development agency, would normally use to support programs designed to improve the Palestinian private sector as well as the domestic investment environment. A program dedicated to improving Palestinian health services is also in jeopardy.

Despite the diversity of the programs affected, the common theme of the freeze is the disruption of activities that might reinforce the Palestinian Authority’s (PA) drive for statehood. In fact, the project proposals for USAID’s economic development sector, especially the Investment Climate Improvement (ICI) program, clearly list Palestinian World Trade Organization (WTO) membership as an essential motivator for financial reform. Essentially, until the PA decided to pursue its statehood bid, the United States not only accepted the Palestinian desire for joining the WTO but actively promoted it.

As the PA President, Mahmoud Abbas, makes the rounds of major international agencies and organizations to ask for Palestinian membership, withholding aid takes on an added level of significance.

It would seem that while the US has publicly committed itself to vetoing the PA’s efforts at the UN Security Council, President Barack Obama and the State Department are frantically working behind the scenes to ensure that such a politically disastrous step is not necessary. Yet, in unabashedly pushing its resolutely pro-Israeli agenda, the United States increasingly appears both arrogant and clueless.

Who is this aid freeze designed to punish?

Within this context, Congress’ decision to withhold assistance from the PA fits with the US’ perpetually increasing favoritism of Israel but it also raises many questions. Given that cutting off foreign assistance to a recipient country is at least in theory a drastic step reserved for pariah states that harm their own people, which behavior is the Congressional aid freeze designed to punish?

As the United Nations’ Special Rapporteur on Human Rights in the Occupied Palestinian Territories Richard Falk recently argued, the PA, regardless of one’s perspective on the desirability of a two-state solution, is exercising a legitimate right to declare its statehood at the UN ("Reflections on the Abbas statehood speech," Al Jazeera English, 4 October 2011).

In this context, the behavior of the United States Congress reflects the institution’s deep-rooted bias against Palestinians, which the largest pro-Israel lobby group in Washington, the American Israel Public Affairs Committee (AIPAC), has carefully cultivated and reinforced through domestic lobbying and fully-funded trips to the region. Indeed, the Congressional members behind the push to freeze aid are all known for their ties to the controversial group, as reported in the Huffington Post ("AIPAC’s democrats demand cutting Palestinian aid," 3 October 2011).

In many ways, the United States, which continues to see itself as a global diplomatic leader despite its heavily damaged international — and especially regional — reputation, is shamelessly acting like a schoolyard bully.

Further highlighting the absurdity of the Congressional move, the cuts come during a time of economic crisis both within Palestine and the United States; and Congress has just affirmed that it will not even consider cutting its funding to the Israeli government. Yet, blindly promoting Israeli security means that US funding and military assistance is directly implicated in the occupation of Palestine — including an extensive list of human rights abuses as well as regular Palestinian civilian injuries and casualties at the hands of Israeli forces armed to the teeth with US-made weapons.

On an annual basis, the already heavily indebted US sends $3 billion to Israel. Israel also benefits from a 10-year $30 billion aid package from the time of George W Bush’s presidency, which Obama agreed to continue immediately after becoming president. And Congress has just decided to decrease the overall budget allocated to foreign aid without reducing this sizeable funding to what the UN classifies as the world’s 15th most developed country, following France and ahead of many countries of the European Union. Such contradictions in US policy speak for themselves.

Under President Obama, who came to office in a furor of hope, the one constant is that justice for Palestinians does not figure among the US’ priorities. Indeed, diplomatic efforts have focused overwhelmingly on how to remove the "Palestinian question" from the international agenda rather than on repairing the damage inflicted by decades of colonialism, neocolonialism, and occupation.

Reasons for optimism amid political theatrics

Yet, the aid freeze combined with the US’s general approach to the UN bid has led to some promising developments on the ground.

Even before Congress announced its decision, university-aged Palestinian activists began to make their sentiments about the US known at a meeting for the USAID-funded Sharek Youth Forum, calling for an end to US funding of the organization and, significantly, presenting an increasingly united front against the agenda-setting role of USAID. According to one of protest’s organizers, an activist with Herak Shababi (a youth movement that sprang up as a part of the larger 15 March movement), those involved were moved to action at the Forum because, while they object to the structure of the aid system as a whole, USAID’s desire to influence the political dialogue of young people is "particularly provocative in the context of the Palestinian struggle for justice."

Virtually all participants also object to USAID’s "terrorism clause," which requires all of the organization’s aid recipients to affirm that they will not fund or take part in terrorist activities, given that the United States considers one of Palestine’s leading political parties, Hamas, to be a terrorist organization.

Most recently, Palestinian students assembled outside a Ramallah-based establishment hosting American employees of USAID to protest the freeze itself. In a telling display of domestic sentiments, students participating in the action declared "Yes we can — boycott America!" The fact that Palestinians themselves are beginning to unite around this issue is promising for domestic political activism as a whole.

While Fatah, the party in control of the PA, has coolly asserted that Arab donors would cover any deficit that results from missing US funds, the PA should take the opportunity to institute internal reforms to reduce the government’s extraordinary dependence on foreign aid. That is what a government that represents the best interests of the Palestinian people would and should do.

Michelle Gyeney is a freelance writer and is researching policy incoherence of development practice in Palestine.

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